Imagination Technologies files formal dispute with Apple

Imagination Technologies, the British company that has been designing Apple’s mobile GPUs for years, has started a “dispute resolution procedure” with the Cupertino company over a licensing standoff.

Imagination has already confirmed that Apple will be dropping its graphics chips within two years and adopting its own instead. But the company suspects Apple has stolen its intellectual property.

Apple began using Imagination technology for the iPod, and it later made its way into iPhone, iPad, Apple Watch, and Apple TV. Every single iOS device produced so far has used Imagination graphics.

But back in April, Imagination confirmed that Apple is designing its own chips and will drop Imagination’s in 15 to 24 months’ time. At the time, the firm said it was skeptical that Apple could develop its own GPUs without stealing Imagination property.

“Imagination believes that it would be extremely challenging to design a brand new GPU architecture from basics without infringing its intellectual property rights,” it said. Imagination claims that it has requested proof that Apple’s technology is original but is yet to receive it.

Imagination has now started a formal dispute with Apple, with the two unable to make satisfactory progress on alternative commercial arrangements for the current license and royalty agreement, Reutersreports.

“Imagination has therefore commenced the dispute resolution procedure under the license agreement with a view to reaching an agreement through a more structured process,” it said.

It’s easy to see why Imagination is hurt by Apple’s move. The deal between the two companies earned Imagination £60.7 million ($75.9 million) in revenue last year, and was expected to bring in £65 million ($81.2 million) for the year ending April 30, 2017.

That’s more than half Imagination’s total income. As a result of the fallout with Apple, shares in the company fell 70 percent on the day Apple’s shift was confirmed, and they have barely recovered. Imagination now has plans to sell off two of its businesses to stay alive.